Tax Headlines

1827

District of Columbia ~ Corporate Income Tax: Combined Reporting Transitional Year Guidance Provided

The District of Columbia’s Office of Tax and Revenue has issued a notice on the requirements for closing out a separate entity account that will now be filing a combined report, due dates for filing the combined report for Form D-20 (Corporation Franchise Tax Return) and D-30 (Unincorporated Business Franchise Tax Return) filers, posting of estimated tax payments that were made on a separate entity basis to the designated agent’s account, the requirements for filing an extension of time to file a return, and the status of combined reporting schedules and proposed regulations.

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District of Columbia ~ Corporate Income Tax: Combined Reporting Transitional Year Guidance Provided

The District of Columbia’s Office of Tax and Revenue has issued a notice on the requirements for closing out a separate entity account that will now be filing a combined report, due dates for filing the combined report for Form D-20 (Corporation Franchise Tax Return) and D-30 (Unincorporated Business Franchise Tax Return) filers, posting of estimated tax payments that were made on a separate entity basis to the designated agent’s account, the requirements for filing an extension of time to file a return, and the status of combined reporting schedules and proposed regulations.

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Hawaii ~ Sales and Use Tax: House Passes Click-Through, Affiliate Nexus Bill

Legislation passed by the Hawaii House of Representatives includes use tax click-through nexus and affiliate nexus provisions that would, if enacted, take effect on July 1, 2112, if the state does not, by June 30, 2013, enact a law in accordance with any federal law authorizing the states to require a seller to collect taxes on sales of goods to in-state purchasers without regard to the location of the seller. Under the legislation passed by the House, a person “engaged in business in the state” would include a seller, including an entity affiliated with a seller within the meaning of IRC §1504, that has substantial nexus with Hawaii for purposes of the Commerce Clause of the U.S. Constitution and upon whom federal law permits the state to impose use tax.

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Senate Continues Work on Highway Reauthorization Bill, Adopts Several Tax-Related Amendments

Senate lawmakers continued work on federal highway legislation (Sen 1813) on March 8, approving an amendment by Senate Finance Committee Chairman Max Baucus, D-Mont., that would reauthorize payments to rural schools, offset, in part, by excise taxes on roll-your-own cigarette machines. Another amendment offered by Sen. Carl Levin, D-Mich., and adopted by the Senate, would prevent offshore tax havens and money laundering.

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California ~ Corporate Income Tax: Regulation on Sourcing of Sales of Other Than Tangible Property Adopted

A California corporation franchise and income tax regulation has been adopted that addresses the market-based sourcing rules for sales of other than tangible personal property when taxpayers elect for taxable years beginning after 2010 to use the single sales factor formula to apportion their business income. These sales are considered to be in the state if the taxpayer’s market for the sales is in the state. Sales from services are assigned to California to the extent the purchaser of the service receives the benefit of the service in California. Sales from intangible property are assigned to California to the extent the property is used in California.

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New Mexico ~ Corporate Income Tax: Governor Vetoes Combined Reporting, Rate Reduction Bill

New Mexico Gov. Susana Martinez has vetoed a bill that would have reduced the highest corporate income tax rate and required combined reporting for certain unitary retail businesses. If enacted, the bill would have reduced the corporate income tax rate for taxpayers with net income over $1 million from 7.6% to 7.5%. In addition, unitary corporations with more than 30,000 square feet of retail space under one roof in New Mexico (i.e., “big box” retailers) would have been required to file a combined return (combined reporting is currently optional for all unitary corporations). The changes would have applied to taxable years beginning in 2013 and thereafter.

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